Market Soars as US-China Slash Tariffs: What’s Moving the Stock Market Today

US and China Reach Breakthrough Trade Deal, Sending Markets Higher

The stock market is experiencing a significant rally today, Monday, May 12, 2025, as investors react enthusiastically to a surprise breakthrough in US-China trade relations. Major indexes are surging after the world’s two largest economies announced a deal to drastically reduce reciprocal tariffs for an initial 90-day period, ending months of escalating trade tensions.

The Dow Jones Industrial Average is set to soar approximately 900 points at the open, while S&P 500 futures are up 2.58% and Nasdaq futures have jumped 3.43% in pre-market trading. This rally comes after a weekend of marathon trade negotiations in Geneva, Switzerland, where officials from both countries touted “substantial progress.”

Under the agreement, the United States will temporarily lower its tariffs on Chinese goods from 145% to 30%, while China will cut its levies on American imports from 125% to 10%. These changes will take effect by Wednesday, May 14.

Current Market Performance

As of the latest data, the major US market indexes stand at:

– S&P 500: 5,802.02 points (previous close)
– Dow Jones Industrial Average: 42,038.77 points
– Nasdaq Composite: 20,743.19 points

The market has shown strong performance in 2025 so far, with the S&P 500 up 7.33% over the past month and 11.12% year-to-date. The tech-heavy Nasdaq has performed even better, gaining 10.36% in the past month and nearly 14% this year.

Why is the market up today? The primary driver is clearly the US-China tariff reduction agreement, which Treasury Secretary Scott Bessent described as “a 90-day pause” where both sides will “substantially move down the tariff levels.” This development has relieved fears of a potential recession that many analysts had warned could result from prolonged trade tensions.

Major Stocks Making Moves

Several individual stocks are showing notable movement today:

– Tesla (TSLA): Shares are rising in pre-market, continuing their strong performance after gaining 4.45% in the previous session. The electric vehicle maker has seen its stock surge 76.64% year-to-date.

– Oracle (ORCL): The tech giant saw its shares climb 2.86% in the previous session, bringing its year-to-date gain to 32.90%.

– NRG Energy (NRG): The company reports Q1 earnings today, with analysts expecting quarterly earnings of $1.67 per share, up from 90 cents per share in the year-ago period.

– Fox Corp (FOXA): The media company will report Q3 earnings this morning, with investors closely watching its performance amid changing media consumption habits.

Upcoming Market Events This Week

This week features several high-profile earnings reports that could further influence market direction:

– Monday (Today): NRG Energy (NRG), Fox Corp (FOXA), Petrobras (PBR), and Simon Property Group (SPG) report earnings.

– Tuesday: JD.com (JD) reports earnings.

– Wednesday: Tencent (TCEHY), Sony (SONY), and Cisco (CSCO) report earnings.

– Thursday: Walmart (WMT), Alibaba (BABA), Deere (DE), and Applied Materials (AMAT) report earnings.

Market Outlook

The 90-day tariff reduction agreement establishes “a mechanism to continue discussions about economic and trade relations,” led by Chinese Vice Premier He Lifeng, US Treasury Secretary Scott Bessent, and US Trade Representative Jamieson Greer.

Market analysts are cautiously optimistic that this temporary measure could lead to a more permanent resolution of trade tensions. However, investors will be closely monitoring developments over the coming weeks, particularly any statements from President Trump regarding the future of US-China trade relations.

With major earnings reports scheduled throughout the week and the fresh momentum from the trade deal, market volatility may remain elevated as investors digest both macroeconomic developments and company-specific news.